Member Info for Soundingoff

wh0s- Read your post and mine again. Your figures agree with mine. There is a difference between NPV and risked NPV.

wh0s- From the RNS and advice prior, 5 * 500bcf GOIP estimate appears fair. 2.5TCF at 55% recovery, with 47.5% share multiplied by the infamous £1.50 gives around £1b. A few variables, but it gives us an idea of what they could be worth. 20-30% risking gives a risked value of £200-£300 million for those drills in isolation. Obviously very rough and ready but helps concentrate your thoughts.

The 5 drill ready prospects probably have an NPV to us of around £1b or higher based on what we've been told about their size. Current COS on TAGI targets is 20-30%, Palaeozoic unknown. My understanding is SBK1 and TE2 would be higher. The value to a buyer is there, the only question is how much.

seaton- There are options open to a company to ensure a transaction obtains capital rather than income status. Though this can be open to negotiation between the Buyer and Seller as it can impact on the Buyer's tax efficiency among other considerations.

It was stated at the AGM Jones. It's up to each individual how they read the situation, but it looks pretty clear to me. It's obvious to me at least, that a data room has been open for some time when you reference to the BB event and the swift decision made on TE10 failure (maybe?). A decision couldn't have happened that quickly otherwise. If you look at sales of this type, the official announcement usually follows the reality. There was a clear plan already set and TE10 closed it off. All IMO of course.

I think the point of drilling five more is a moot one to be honest. I think we've run out of time and need to hand our asset over.

People can argue over the worth all they like, but right now what matters is what a Buyer is willing to pay. The first place you look as a seller is the market. I've done that and understand what we can get for the Horst and it's our NPV10 value (give or take) less a minor discount. Then we can risk our drillable targets and the basin as a whole. Again, this is how it works in reality, not in the mind of a emotional PI.

There is value over and above the Horst, but the scale of exploration potential that we have doesn't come around very often and it's very hard to find out what someone would be willing to pay. I have my own thoughts based on risking of those targets and the reward of drilling vs exploration costs. The only difference here is there is also value in taking a foothold in Morocco, for geographical and geopolitical reasons and of course the changing landscape of fossil fuels vs renewable and bridging that gap.

Jones- You state that you don't think there's been an interest. I'm afraid that's wrong. We have already been told by the BOD that we have and are making multiple management presentations. If you note from yesterday's FSC, the management presentations follow the data room.

wh0s- It doesn't really matter what we think. If you look at recent O&G sales, you will see that your statement conflicts will all sales data out there. Carry on though.

Fantastic n4a.

After today, I don't think we have long to wait.

n4a- It's all very well having another rant, but what about that bet you suggested? Your words appear to have conviction, but maybe not your thoughts? Unless you genuinely missed my post...

Sunday- These developments are usually sold on an NPV basis rather than a PE ratio. The Horst is very close to finalised in development terms and based on O&G sales data, should sell at a small discount from NPV. Here we are at roughly 27p give or take a few variables.

I've come to exactly the opposite conclusion wh0s. From the commentary it appears we're further along in the sale process than it would appear at first glance.

Unfortunately much of Board's time was taken up by rude, abusive idiots.

Yes furey, that’s the main point to take away from the article for SDX holders. Sound are selling if they get the offers and they have talked about consolidation in country for some time.

Link doesn't copy well, it's on this page.

https://www.africaintelligence.com/rub/corridors-of-power

https://www.africaintelligence.com/aem/corridors-of-power/2019/06/11/sdx-energy-and-sound-energy-for-sale-rothschild-s-double-whammy,108360800-bre

Apologies if already posted. Consolidation has always been on the list of possibilities for an O&G company in Morocco...

I would love to have a drink with you trellis. New World red for me if you're offering and you can find some in your cellar. I don't think you're going to need to host though.

I'm certainly no disciple and fully understand people's concerns on some matters. However I invested in Sound firstly because of the asset. We have to some degree failed at the drill bit, but that is O&G and somewhere there is a balance of mistakes vs chance of success.

I planned for some failure and still expect a return here because of the potential that exists in the basin.

'Sounding and SG- are we earning any money to fund our ongoing costs?- NO. are we exploring with seismic or drill any more? NO . Is not O+G exploration about exploring? - YES . Do we have information that we are going to take Te5 to production and thus start earning- NO. Do we have FEED, FID or GSA- NO'

Does any of that matter right now given we are selling the company?- No.

The Horst is incredibly close to plug and play (insert Sidi joke if you like). Just a cursory glance at other developments that have sold will tell you that. You are missing the point on that one.

And where have we said we have given up exploring? We have paused and more importantly can begin again if we wish. We are funded to be able to make these decisions without cash concerns. Saying that, I think the likelihood of us drilling again are slim at best.

Pointless facts are still pointless.

Ponkey- I think it's fairly straightforward, they're just giving themselves more time to ensure the answers are as detailed as possible without breaching any rules given we are marketing the company. It's a fine line to walk.

No we really don't need rescuing trellis. Without appearing rude, if you think we do, you have no ability to rationally assess a company or have little knowledge of the O&G sector.

We don't need 'rescuing' Exploration, but you are right, we have some serious connections in country.

Agreed Ponkey.

- Final FEED now in review
- Potential buyers reviewing data
- A buyer would take on a substantial drilling campaign

Of course that is only their expectation regarding the last comment, but that is why I keeping mentioning the risk vs reward. Putting seismic to one side, it's very easy to calculate the costs of drilling vs the reward of successful drills. Apply a risking to that and the rest of the basin. Some targets are more mature than others.